| Pentonomics - Government Employment Data is a bit confusing |
September 6, 2010 - 7:11pm — mpento
Michael Pento, Senior Economist at Euro Pacific Capital is a well-established specialist in the “Austrian School” of economics. He is a regular guest on CNBC, Bloomberg, Fox Business, and other national media outlets and his market analysis can be read in most major financial publications, including the Wall Street Journal. Prior to joining Euro Pacific, Michael worked for a boutique investment advisory firm to create ETFs and UITs that were sold throughout Wall Street. Earlier in his career, he worked on the floor of the NYSE.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License. Please feel free to repost with proper attribution and all links included.
Tuesday, September 7, 2010
By:
Michael Pento Last Friday the Department of Labor stated that for the month of August the U.S. created 67,000 private sector, service-providing jobs. The Bureau of Labor Statistics also indicated that total private job creation was 67,000 individuals. That means without those service sector jobs, total private sector job growth would have been zilch.
But a report from the Institute for Supply Management (ISM)--a non-government entity—indicated that the service sector employment situation actually contracted in August. In fact, the Non-Manufacturing Index dropped precipitously from 54.3 to 51.6. New orders dropped from 56.7 to 52.4 and most importantly, the Employment Index dropped into contraction territory to 48.2 from 50.9.
So this begs the question; how can the government claim that all of the private sector job growth came from the service sector, while the ISM national reading on the service sector contends that employment is contracting.
And if you can answer that you should take a crack and solving this: If 90% of our economy is showing marked weakness and is now barely in expansion territory, where are the jobs going to come from? We can hope for a manufacturing renaissance in the USA, but that seems unlikely given our government has declared war on the goods producing sector.
Michael Pento, Senior Economist at Euro Pacific Capital is a well-established specialist in the “Austrian School” of economics. He is a regular guest on CNBC, Bloomberg, Fox Business, and other national media outlets and his market analysis can be read in most major financial publications, including the Wall Street Journal. Prior to joining Euro Pacific, Michael worked for a boutique investment advisory firm to create ETFs and UITs that were sold throughout Wall Street. Earlier in his career, he worked on the floor of the NYSE.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License. Please feel free to repost with proper attribution and all links included.
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